Small business owners in the Northwest Territories strained by collapsing demand amid a global pandemic may see some relief from Ottawa soon.

The federal government has committed to raising its crisis wage subsidy from 10 per cent to 75 per cent, offering up to $40,000 in loans that will be interest free for one year, and deferring GST/HST and import/export fees until June, Prime Minister Justin Trudeau announced Friday.

Renee Comeau, executive director of the NWT Chamber of Commerce, called it a 鈥済reat step.鈥� 

The chamber recently co-signed a letter with other business associations asking for federal support to stave off layoffs. She saw Ottawa鈥檚 response as answering those calls, but added there was more work to be done to keep businesses afloat. 

It will come as a relief to stressed businesses worried over payroll expenses and costs like rent 鈥� which also should be addressed, she said.

Meanwhile, the interest-free loan would be essential as businesses look to cover incoming payments, she said. 

鈥淚t鈥檚 a quick and easy way for businesses to get cash flow injected back in so that they鈥檙e able to catch up with their supply chain,鈥� she said. 

While some NWT business owners shared relief with News/North, others were still buckling under the economic crunch.

"A huge boost," Fort Smith business owner says

Laurie Young, owner of Fort Smith鈥檚 The Rusty Raven, said the assistance could save some staff positions at her business.

鈥淭he 75 per cent of the wage that I pay my staff is better than the 60 per cent they鈥檇 get from unemployment,鈥� she said.

Friday鈥檚 news came after Young decided to close shop last Saturday. Ottawa鈥檚 originally proposed 10 per cent was little more than a token, she said, and wouldn鈥檛 have made much difference. The update pleased her.

鈥淭hat鈥檚 going to be a huge boost to us. Having absolutely no income coming in, it makes it pretty rough,鈥� she said.

She was less concerned with federal loan programs, saying she would work with NWT鈥檚 Business Development and Investment Corporation (BDIC) first.

At the territorial level, Minister of Finance Caroline Wawzonek on March 20 said the corporation would also offer low interest loans and was deferring payments for up to three months between April 1 and Sept. 30.

For Young, however, it鈥檚 always a fight for staff in a small town. If some residents choose to stay in Fort Smith, or opt to return because there鈥檚 work, it will make a difference.

"Hanging on by your teeth"

John Doody, who co-owns The Dancing Moose Cafe with his wife in Yellowknife, didn鈥檛 see the benefit for his business.

鈥淔or restaurants in town, it鈥檚 essentially useless,鈥� he said.

There simply isn鈥檛 enough demand. When the crisis began, he felt the business may be able to continue; the crowds remained strong.

But within days the cafe was down to one or two tables. Considering the loan aspect, Dooby said he would rather draw on savings, but that it could help retailers.

鈥淎 wage subsidy now would just mean we鈥檙e paying people to stand around,鈥� he said. 鈥淔or us, it鈥檚 useless.鈥�

Wherever possible, small business owners need some slack, according to Mary Beckett, a longtime consultant and business owner in Inuvik who ran as NWT鈥檚 federal NDP candidate last fall.

鈥淚 feel heartbroken for everybody who runs businesses,鈥� she said. 鈥淏ut I know from running a business for many, many, many years, there鈥檚 always cycles.

鈥淚t鈥檚 always a case of hanging on by your teeth until things come around again.鈥�

She said new businesses or those already close to the wire, particularly in small communities, may not be able to bounce back. But those with strong business models prior to the crisis should be able weather the coming weeks or months until demand recovers, she said.

Cash flow a pressing concern

For others, the economic impact setting in as residents stay home has been devastating.

Terry Rowe, general manager of the Ptarmigan Inn in Hay River, felt the pandemic鈥檚 economic strain last week, when he personally laid off about 50 staff. It鈥檚 a temporary measure, he told News/North, but a hard one.

Much of it stems steps responding to the public health crisis that led the business to shutter non-essential services, including its restaurant and gym.

It continues to offer take-out, but that鈥檚 slowed alongside overnight stays at the hotel. That means there鈥檚 little demand left to support staff as catering and events cancel as borders close.

The staff were understanding of the circumstances, but it鈥檚 been 鈥渟tressful,鈥� he said.

He hoped to apply to government support soon. However, in the future, he said, he may be 鈥減ulling (his) hair out鈥� as a result of the damage to the business鈥� cash flow, he said.

Utilities, taxes, and other costs waited just ahead, with little revenue to balance them.